439B.325 Major hospital to provide disclosure
to patient who does not have medical insurance; effect of discount on prior
arrangement to pay; circumstances entitling hospital to recover discount.

439B.330 Determination of reasonableness of
arrangement for payment; hospital to provide written notice of terms of
arrangement and respective rights and obligations to patient; adjustment of
monthly payments.

439B.620 Powers of director: Designation of
person to issue declaratory order or advisory opinion; consolidation of
petitions for advisory opinions.

439B.630 Issuance of declaratory order or
advisory opinion: Time for issuance; tolling of time for issuance; consolidated
petitions.

439B.640 Copy of declaratory order or
advisory opinion to be mailed to petitioner and made available to public.

REVISER’S NOTE.

The regulation of the Director of the Department of Human
Resources (now the Department of Health and Human Services) filed with the Secretary
of State on December 31, 1991, LCB File No. R168-91, contains several
provisions not included in NAC. Those provisions:

1. Require each major hospital to submit
to the Department within 5 days after the beginning of each calendar quarter a
complete charge master that was in effect on the first day of the quarter;

2. Describe the required contents of the
charge master;

3. Prohibit a major hospital from
charging a patient for an item that is not included on its charge master or its
supplemental listing for miscellaneous items, and from charging a higher amount
than the amount shown on the charge master, without the approval of the Director;
and

4. Establish procedures regarding the
approval and disapproval of billed charges for items not included in the
supplemental listing for miscellaneous items.

GENERAL PROVISIONS

NAC 439B.010Definitions.As used in this chapter,
unless the context otherwise requires, the words and terms defined in NAC 439B.030 to 439B.190,
inclusive, have the meanings ascribed to them in those sections.

NAC 439B.030“Billed charge” defined. “Billed charge” has the meaning
ascribed to it in NRS 439B.030.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.040“Department” defined.“Department” has the
meaning ascribed to it in NRS
439B.050.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.050“Director” defined.“Director” has the meaning
ascribed to it in NRS 439B.060.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.080“Fiscal year” defined.“Fiscal year” has the
meaning ascribed to it in NRS
439B.090.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.090“Health facility” defined.“Health facility” has the
meaning ascribed to it in NRS
439A.015.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.100“Hospital” defined.“Hospital” has the meaning
ascribed to it in NRS 439B.110.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.110“Hospital fiscal year” defined.“Hospital fiscal year” has
the meaning ascribed to it in subsection 2 of NRS 439B.090.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.120“Indigent” defined.“Indigent” has the meaning
ascribed to it in NRS 439B.310.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.130“Inpatient” defined. “Inpatient” means a patient who:

1. Is formally admitted to a hospital;

2. Is assigned to a regularly maintained
inpatient bed; and

3. Has an inpatient medical chart initiated
by the hospital.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.140“Inpatient billed charges” defined. “Inpatient billed
charges” means those billed charges which are attributable to the provision of
inpatient care by a hospital.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.150“Inpatient net revenue” defined.“Inpatient net revenue”
means the net revenue which is attributable to the provision of inpatient care
by a hospital.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.155“Major hospital” defined.“Major hospital” has the
meaning ascribed to it in NRS
439B.115.

(Added to NAC by Dep’t of Human Resources, eff. 12-31-91)

NAC 439B.160“Medicaid” defined.“Medicaid” has the meaning
ascribed to it in NRS 439B.120.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.170“Medicare” defined.“Medicare” has the meaning
ascribed to it in NRS 439B.130.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.180“Net revenue” defined.“Net revenue” has the
meaning ascribed to it in NRS
439B.140.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.185“Operating budget” defined.“Operating budget” means a
plan of financial operations embodying an estimate of proposed expenditures for
a given period and the proposed means of financing such expenditures, and
generally including at least the following information:

1. The period of the budget (inclusive
dates);

2. Forecasted patient days;

3. Percentage of rate increase to be implemented;

4. Forecasted gross revenues;

5. Forecasted contractual allowances, bad
debt and discounts;

6. Forecasted operating expense;

7. Forecasted income from hospital
operations;

8. Forecasted nonoperating revenues;

9. Forecasted nonoperating expense; and

10. Forecasted total income or loss.

(Added to NAC by Dep’t of Human Resources, eff. 10-20-93)

NAC 439B.190“Practitioner” defined.“Practitioner” has the
meaning ascribed to it in NRS
439B.150.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

FINANCIAL PRACTICES OF HOSPITALS

NAC 439B.220Submission of quarterly reports.

1. Each hospital shall submit the following
information not later than 30 days after each quarter:

(a) Financial reports in the form prescribed by the
department;

(b) Utilization reports in the form prescribed by
the department; and

(c) A statement of all substantial changes in the
services provided by the hospital in the quarter.

2. The department shall adopt forms and
instructions for the quarterly financial and utilization reports to be filed
pursuant to subsection 1.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 1-2-90; 10-20-93)

NAC 439B.230Submission of annual financial reports.Each year a hospital shall
file with the department:

1. A copy of the report required to be
submitted by the hospital to the Health Care Financing Administration for the
purpose of Medicare payments, commonly known as the Medicare Cost Report within
120 days after the end of the hospital’s Medicare fiscal year.

2. At least 30 days after the beginning of
each hospital fiscal year, a proposed operating budget for the hospital for the
hospital’s fiscal year.

3. Within 30 days of receipt by the
hospital, a copy of any report by an independent auditor concerning a financial
audit of the hospital’s operations.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.240Certification of financial reports; penalty for failure to submit
information; request for extension of time.

1. The officers of a hospital shall certify
that the financial reports required to be submitted by a hospital to the
department are, to the best of their knowledge and belief, accurate and complete.

2. Except as otherwise provided in
subsection 3, any person who fails to submit information required pursuant to
this chapter on the date for submission is subject to an administrative fine of
up to $1,000 for each day the information is not submitted. The fine will be
imposed after notice and a hearing pursuant to NAC
439B.520.

3. A person may request an extension to
submit information required by this chapter if the request:

(a) Is received by the department before the
information is due; and

(b) Sets forth an adequate justification of the
reasons for the delay and a proposed submission date.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.250Submission of copy of audit.Each hospital in this
state with not more than 200 beds or which is subject to the provisions of chapter 450 of NRS shall submit to the
department a copy of its audit. The audit must be conducted by an independent
auditor at least annually. The hospital shall submit a copy of the audit within
30 days after receipt by the hospital of the audit from its auditor.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.260Independent audits; penalty for failure to cooperate.

1. The director shall contract at least
biennially with an independent auditing firm to conduct an examination of each
hospital in this state with more than 200 beds which is not subject to the
provisions of chapter 450 of NRS to
ensure compliance with this chapter. The director shall determine the scope of
the examination for each hospital.

2. The auditor shall conduct the examination
to determine whether the hospital is in full compliance with this chapter.

3. The auditor shall maintain separate
accounts of the costs of the audit for each hospital. Each hospital subject to
the audit shall pay the costs of the audit.

4. A hospital may contract with the auditing
firm appointed by the department for other work in the hospital in connection
with the audit.

5. Any person who fails to submit
information to the auditor upon request or who fails to submit to the audit is
subject to an administrative fine of up to $1,000 for each day the person fails
to submit the information or submit to the audit. The director may impose the
fine after notice and a hearing pursuant to NAC
439B.520.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

MAJOR HOSPITALS

NAC 439B.325Major hospital to provide disclosure to patient who does not have
medical insurance; effect of discount on prior arrangement to pay;
circumstances entitling hospital to recover discount.

1. A major hospital which is required to
reduce or discount the total billed charge for hospital services provided to an
inpatient pursuant to NRS 439B.260
shall provide each patient who informs the hospital that he does not have
medical insurance or other coverage to pay for inpatient services with a
written disclosure approved by the director explaining:

(a) That the patient may be entitled to receive a
reduction or discount on his total billed charge; and

(a) A person who “has no insurance or other
contractual provision for the payment of the charge” includes a person who
discovers after he is discharged from the hospital that he has no insurance or
other contractual provision for the payment of the charge.

(b) “Total billed charge” means the itemized
billing required pursuant to NRS
449.243 for each stay of a patient and any additional charges for inpatient
hospital services for that stay which are discovered after the submission of
the itemized billing.

3. A patient who qualifies for a discount
must receive the discount regardless of any prior arrangement to pay, unless
the prior arrangement would result in a lower total cost to the patient.

4. A major hospital may require a patient
who requests a discount to sign an agreement which assigns to the hospital all
benefits that are payable to the patient from medical insurance or other
coverage with regard to the total billed charge. Regardless of whether the
patient signs such an agreement, if either the hospital or the patient receives
payment from a payer with regard to the total billed charge, the discount
becomes void and the hospital is entitled to recover the amount of the discount
from the patient or payer according to the terms of the coverage.

5. In addition to the right of recovery
pursuant to subsection 4, if a patient fraudulently represents to a hospital
that he does not have a payer, the hospital is entitled to any additional
remedies provided by law.

6. For the purposes of this section, “payer”
means an insurance company or other third-party organization which has a
contractual obligation to pay for hospital services provided to a patient,
including, without limitation, a program of public assistance provided by an
agency of the local, state or Federal Government.

(Added to NAC by Dep’t of Human Resources, eff. 8-1-94)

NAC 439B.330Determination of reasonableness of arrangement for payment;
hospital to provide written notice of terms of arrangement and respective
rights and obligations to patient; adjustment of monthly payments.

1. Except as otherwise provided in subsection
2, to be deemed reasonable, the arrangement for payment required pursuant to
paragraph (c) of subsection 1 of NRS
439B.260 must include at least a monthly payment which is the greater of:

(a) Twenty-five dollars; or

(b) Five percent of the monthly gross income of the
patient’s household, exclusive of income which is not paid in cash, or 25
percent of the monthly gross income of the patient’s household which exceeds
200 percent of the federal poverty level, whichever is less.

2. An arrangement for payment which is
different than the arrangement set forth in subsection 1 will be deemed
reasonable if it is mutually agreed upon by the hospital and the patient.

3. At the time an arrangement for payment is
made, the hospital shall provide written notice to the patient disclosing the
terms of the arrangement and the respective rights and obligations of the
patient and the hospital. The notice must provide a space for the patient’s
signature. The hospital shall require the patient to sign in the provided space
as acknowledgment that he understands and agrees to the arrangement for
payment. If the hospital is not able to obtain the signature of the patient, it
must maintain a record of its good faith effort to obtain his signature.

4. A major hospital may review the financial
situation of a patient and adjust his monthly payments not more than one time
per year.

(Added to NAC by Dep’t of Human Resources, eff. 8-1-94)

NAC 439B.335Initial payment from patient upon admittance to hospital.

1. A major hospital may require an initial
payment from a patient who is admitted to the hospital.

2. If a patient elects to be admitted to a
major hospital, the hospital may require an initial payment in addition to any
other preadmission deposits or payments.

3. A major hospital shall not require an
initial payment towards the total billed charge which exceeds:

(a) Two and one-half times the monthly payment
determined pursuant to subsection 1 of NAC 439B.330;
or

(b) Fifty percent of the unencumbered liquid assets
of the household of the patient.

(Added to NAC by Dep’t of Human Resources, eff. 8-1-94)

NAC 439B.340Determination of annual rate of interest on unpaid balance of
total billed charge; effect of delinquent account; sale, assignment or transfer
of right to balance due on account.

1. If a major hospital charges interest on
the unpaid balance of the total billed charge of a patient, the annual rate of
interest must be based on the balance due after any reductions or discounts.
The interest rate must not exceed the statutory interest rate in effect on the
date that the arrangement for payment is agreed upon.

2. If the account of a patient becomes
delinquent by 30 days or more:

(a) Upon the first and second occurrences, the
hospital shall provide written notice of the delinquency to the patient. If the
delinquency is not cured within 10 days after the patient receives the notice,
the hospital may revoke any discount that was provided to the patient and seek
to accelerate payment on the account.

(b) Upon the third and subsequent occurrences, the
hospital may revoke the discount and seek to accelerate payment without
allowing the patient 10 days to cure the delinquency.

3. The sale, assignment or transfer of the
right to the uncollected amount of the balance due on the account of a patient
with a major hospital is subject to the terms and conditions of any agreement
between the hospital and the patient. Any such sale, assignment or transfer is
also subject to the provisions of subsection 2.

1. Each hospital shall, within 120 days
after the end of the hospital’s Medicare fiscal year, submit to the department
a copy of the report required to be submitted to the Health Care Financing
Administration for the purpose of Medicare payments, commonly known as the
Medicare Cost Report, for each hospital fiscal year.

2. Each such hospital whose hospital fiscal
year ends June 30, shall submit to the department an estimate of its inpatient
net revenue for its current hospital fiscal year not later than June 30 of each
year.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.420Determination of minimum obligation.

1. The department shall:

(a) For the purposes of determining 0.6 percent of
a hospital’s inpatient net revenue for the hospital’s previous fiscal year
pursuant to NRS 439B.320, use
the report required to be submitted by the hospital pursuant to NAC 439B.410 for the most recent hospital fiscal year
ending before July 1 in any year.

(b) Determine the amount of the hospital’s minimum
obligation by:

(1) Dividing the amount shown as inpatient
total patient revenues on line 25 of Worksheet G-2 of the 2552-89 Medicare Cost
Report or comparable line on a subsequent Medicare Cost Report by the amount
shown as the total of all total patient revenues on the same line;

(2) Multiplying the result of paragraph (a) by
the amount reported as Net Patient Revenues on line 3 of Worksheet G-3 of that
report to determine the hospital’s total inpatient net revenue; and

(3) Multiplying the result of paragraph (b) by
0.006.

2. The amount determined pursuant to
paragraph (b) of subsection 1 is subject to an adjustment by the department
based upon the receipt of subsequent information or an audit or examination of
the hospital. The adjustment must be made to the current or following year of
the hospital’s obligation pursuant to this section.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.430Reports on actual and estimated minimum obligation; notification
to board of county commissioners.

1. On or before July 31 of each fiscal year,
the department shall report to the affected hospitals and the boards of county
commissioners of Clark and Washoe counties:

(a) The actual minimum obligation for indigent care
for each hospital located in the county with a hospital fiscal year ending on a
date other than June 30; and

(b) The estimated minimum obligation for indigent
care for each hospital located in the county with a hospital fiscal year ending
on June 30.

2. Within 30 days after receipt of the
report required to be submitted by NAC 439B.410
for each hospital with a hospital fiscal year ending June 30, the department
shall notify the board of county commissioners of the county in which the
hospital is located of the hospital’s actual minimum obligation for indigent
care as determined pursuant to NAC 439B.420. The
department shall notify the board of county commissioners of any adjustments
made pursuant to subsection 2 of NAC 439B.420
within 30 days after the adjustment.

3. For the purposes of the determinations
and reports which are required to be made by the department pursuant to NRS 439B.420, the department
shall use the information provided in the report submitted to the department by
the county pursuant to that section.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.435Delivery to hospitals of reports on indigent patients treated.Each
county that is subject to the provisions of NRS 439B.340 shall, at the time
it provides the department with the report required by that section, deliver a
copy of the report to each hospital affected thereby.

(Added to NAC by Dep’t of Human Resources, eff. 1-9-89;
A 10-20-93)

Appeal of Determination of Indigent Status

NAC 439B.441Applicability.A hospital appealing a determination of a
county regarding the indigent status of an inpatient pursuant to subsection 4
of NRS 439B.330 shall comply
with the provisions of NAC 439B.441 to 439B.449, inclusive.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.442Exhaustion of administrative procedures.A hospital must exhaust
all available administrative procedures with a county before filing an appeal
of a determination of a county regarding the indigent status of an inpatient
with the director or the person designated by the director to hear such an
appeal.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.443Filing and contents of appeal; submission of additional material
upon request.

1. An appeal of a determination of a county
regarding the indigent status of an inpatient must be in writing and must be
filed with the director within 30 calendar days after the date the hospital
receives written notification of the county’s final determination.

2. An appeal must include the following information
and documentation:

(a) The name of the patient;

(b) The date or dates of service;

(c) The amount billed;

(d) A listing of all determinations made by the
county regarding the claim, including the date and the reason for rejection;

(e) All correspondence between the hospital and the
county regarding the application for verification of indigent status of the
patient;

(f) Any other information submitted by the hospital
to the county for consideration in making its determination; and

(g) A written explanation of the basis for
believing that the county’s decision was clearly erroneous, arbitrary,
capricious or an abuse of discretion.

3. In addition to the information and
documentation required by subsection 2, the director or his designee may request
additional information or documentation from the hospital. An appeal may be
dismissed if the director or his designee does not receive the additional
information or documentation within 15 calendar days after the request is made.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.444Determination to hold hearing or to issue decision denying appeal
without hearing.After
considering the information and documentation specified in NAC 439B.443, the director or his designee will:

1. Hold a hearing; or

2. Based upon a finding that the county
acted properly in rejecting the application, render a written decision that the
appeal is without merit.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.446Scheduling and notice of hearing.If the director or his
designee determines that a hearing on the indigent status of an inpatient is
necessary, he will set a time and place for the hearing and send notice of the
hearing to the hospital and the county by registered or certified mail. Unless
all parties otherwise stipulate, the hearing must be held not less than 30
calendar days nor more than 60 calendar days after the date the appeal was
received by the director or his designee.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.447Presentation of evidence at hearing.At a hearing held pursuant
to NAC 439B.446:

1. Except as otherwise provided in
subsection 3, the hospital and the county may present evidence in support of
their positions.

2. The director or his designee may request
any information or documentation that he deems necessary to render a decision
on the appeal.

3. Except as otherwise provided in
subsection 2, the hospital shall not present evidence other than the
information and documentation specified in NAC
439B.443, unless it has shown to the satisfaction of the director or his
designee that the evidence is material and there is good cause for its failure
to present the evidence to the county. The director or his designee may
consider the additional evidence or may order the hospital to submit the
additional evidence to the county and remand the application to the county.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.448Issuance of decision after hearing.If a hearing is held
pursuant to NAC 439B.446, the director or his
designee will render a written decision within 30 calendar days after the date
of the hearing, or if additional information or documentation is requested at
the hearing, the director or his designee will render a written decision within
30 calendar days after receipt of such information.

(Added to NAC by Dep’t of Human Resources, eff. 9-16-92)

NAC 439B.449Contents of decision issued after hearing; effect of decision
issued without or after hearing.

1. The written decision of the director or
his designee rendered pursuant to NAC 439B.448
must:

(a) Affirm the county’s decision; or

(b) Reverse or remand the county’s decision, in
whole or in part, if substantial rights of a hospital have been prejudiced
because the county’s decision was:

NAC 439B.455Disclosure required of financial interest in facility or service
to which patient referred. A health facility shall not
refer a patient to a health facility or service in which the referring party
has a financial interest unless the health facility first provides the patient
with a written statement disclosing that interest.

(a) Establish a schedule for the submission of a
listing of all contracts between a hospital or a related entity and a
practitioner. The listing must indicate with respect to each contract:

(1) The type of contract, such as for rent,
for services as a medical director, or for some other purpose;

(2) The practitioner’s name and address;

(3) The effective date of the contract; and

(4) The term of the contract.

(b) Request by registered mail the submission of
the listing from hospitals pursuant to paragraph (a). Each hospital which
receives such a request shall submit the listing within 30 days after receipt
of the written request.

(c) Within 30 days after receipt of the listing
from a hospital, schedule with the hospital an on-site review of the actual
contracts, agreements and records concerning the contracts between the hospital
or related entities and the practitioners. The hospital must submit copies of
any contracts or agreements which the department requests.

2. If a contract, agreement or record
indicates that a violation of NRS
439B.420 may have occurred, the director shall allow the hospital or any
other party to an agreement with the hospital who is under investigation to
provide additional information. The hospital shall provide that information
within 30 days after receipt of the written notice from the director informing
the hospital or party that it may provide such additional information.

3. Within 30 days after receipt of the
additional information or after the period for submitting the information has
expired, the director shall:

(a) If he determines that there is reason to
believe a violation of NRS
439B.420 has occurred, schedule and hold a hearing pursuant to NAC 439B.520; or

(b) If he determines that there is not a sufficient
reason to believe that a violation of NRS 439B.420 has occurred, notify
the hospital in writing of his determination.

4. The failure of the director to take
action within the periods specified in subsection 2 or 3 of this section shall
not be deemed an abandonment of the action or a determination that no violation
occurred.

5. Unless a public hearing is held pursuant
to subsection 3, all information submitted pursuant to this section is
confidential. The department shall not disclose that information to any person.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.480Contracts and agreements which must be listed and submitted to
department.

1. The following contracts and agreements
must be included in the listing submitted to the department by a hospital
pursuant to NAC 439B.470:

(a) All rental agreements between the hospital or a
related entity and a physician or entity which employs physicians;

(b) All agreements between the hospital or related
entity and a physician or entity which employs physicians concerning the
subsidization of rent by the hospital or related entity;

(c) All agreements between the hospital or a
related entity and a practitioner for the hospital or a related entity acting
as the billing agent of the practitioner;

(d) All agreements for the selling of goods or
services from the hospital or related entity to a physician; and

(e) Such other agreements and information as the
director determines may be necessary to determine if a violation of NRS 439B.420 has occurred.

2. The hospital or related entity must
submit to the department copies of any contract or agreement requested by the
department.

(a) Establish a schedule for the submission of a
listing of all contracts and agreements between the hospitals and related
entities pursuant to NRS 439B.430.
The schedule must require the submission of the listing from each hospital at
least biennially.

(b) Notify each hospital in writing at least 30
days before the date for submission of the listing of contracts and agreements
between the hospital and its related entities. The department shall specify in
its notice the beginning and ending of the period for which the contracts and
agreements will be reviewed.

2. A hospital shall, within 30 days after
receipt of the written notice from the department or the date for submission
contained in the notice, whichever is later, submit the requested information
to the department. Unless an action is taken by the department against the
hospital to determine if a violation of NRS 439B.430 has occurred, all
information submitted pursuant to this section is confidential. The department
shall not disclose the information to any person.

3. The department shall, within 30 days
after receipt of the listing from the hospital, schedule with the hospital an
on-site review of the actual contracts, agreements and records concerning the
contracts and agreements between a hospital and its related entities. The
department shall review the information and determine if there is reason to
believe a violation of NRS
439B.430 has occurred.

4. If the department determines that:

(a) There is reason to believe that a violation has
occurred, it shall forward the information and its determination to the
director and notify the hospital in writing of its determination;

(b) There is no reason to believe a violation has
occurred, it shall notify the hospital in writing of its determination; or

(c) Additional information is required to determine
if a violation has occurred, it shall request the additional information from
the hospital or its related entity. The hospital or its related entity shall
provide the additional information within 30 days after receipt of the request
therefor.

5. This section does not prohibit the
director from conducting an examination pursuant to subsection 3 of NRS 439B.430 at any time.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.500Determination by director of whether prohibited transaction
between hospital and related entity has occurred.

1. The department shall forward to the
director any information which would support a determination that a violation
of NRS 439B.430 has occurred.

2. Upon receipt of the information from any
source which provides reason to believe that a violation of NRS 439B.430 has occurred, the
director shall allow the hospital to submit additional information from the
hospital or related entity or any other party to an agreement with the hospital
or related entity being investigated.

3. If the director determines that there is:

(a) Reason to believe a violation of NRS 439B.430 has occurred, he
shall schedule and hold a hearing pursuant to NAC
439B.520; or

(b) Not sufficient reason to believe that a
violation of NRS 439B.430 has
occurred, he shall notify the hospital of his determination in writing.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

NAC 439B.510Reasonable cause to believe that prohibited transaction between
hospital and related entity has occurred.Reasonable cause to
believe that a violation of subsection 2 of NRS 439B.430 has occurred
includes, but is not limited to:

1. The failure of a hospital or related
entity to submit the copies required by NAC 439B.490
concerning an agreement, contract or transaction between the hospital and a
related entity.

2. One or more related agreements, contracts
or transactions between the hospital and its related entities resulting in:

(a) An increase in the hospital’s operating
expenses;

(b) A decrease in the hospital’s net patient
revenue; or

(c) A combination of paragraphs (a) and (b),

of more than 1 percent from the previous fiscal year.

3. The value of the goods, services or
consideration which is the subject of an agreement, contract or transaction
between the hospital and a related entity being found to be materially
different from the fair market value for similar agreements, contracts or
transactions between nonrelated entities in the same area.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88)

NAC 439B.520Hearing required before imposition of penalty.

1. Before imposing any financial penalty or
other penalty pursuant to this chapter, the director shall hold a hearing
concerning the penalty.

2. The proceedings conducted pursuant to
this section must be conducted pursuant to chapter 233B of NRS.

(Added to NAC by Dep’t of Human Resources, eff. 4-13-88;
A 10-20-93)

REFERRALS BY PRACTITIONERS

NAC 439B.5205Definitions.As
used in NAC 439B.5205 to 439B.5408,
inclusive, and for the purpose of enforcing the provisions of NRS 439B.425, unless the context
otherwise requires, the words and terms defined in NAC
439B.5207 to 439B.540, inclusive, have the
meanings ascribed to them in those sections.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5207“Commercial establishment” defined.“Commercial establishment”
means any business entity that provides goods or services other than a medical
laboratory or a health facility.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.530“Financial interest” defined.

1. Except as otherwise provided in paragraph
(f) of subsection 2 of NRS
439B.425, “financial interest” means an ownership or other interest:

(a) That provides compensation based, in whole or
in part, upon the volume or value of goods or services provided as a result of
referrals; and

(b) Which a practitioner or a person related to the
practitioner within two degrees of consanguinity or affinity:

(1) Owns, in whole or in part; or

(2) Holds as a beneficiary of a trust.

2. The term includes, but is not limited to:

(a) A financial kickback, referral fee or finder’s
fee.

(b) An income-sharing agreement, debt instrument,
or lease or rental agreement that provides compensation based, in whole or in
part, upon the volume or value of the goods or services provided as a result of
referrals.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5302“Group practice” defined.“Group practice” has the
meaning ascribed to it in paragraph (a) of subsection 4 of NRS 439B.425.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5304“Medical laboratory” defined.“Medical laboratory” has
the meaning ascribed to it in NRS
652.060.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5306“One parcel of land” defined.“One parcel of land” means
one conveyable lot or parcel of land or multiple conveyable lots or parcels of
land which are contiguous.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5308“Patient” defined.“Patient” has the meaning
ascribed to it in paragraph (b) of subsection 4 of NRS 439B.425.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.540“Refer” defined. “Refer” means sending or
directing any person to another person or business entity for the purpose of
obtaining, consuming or purchasing, for consideration, goods or services
related to health care.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5402Prohibited referral of patients by agent, employee or independent
contractor of practitioner.The provision of subsection 1 of NRS 439B.425 prohibiting a
practitioner from referring a patient, for a service or for goods related to
health care, to a health facility, medical laboratory or commercial
establishment in which the practitioner has a financial interest, must be
construed as prohibiting any agent, employee or independent contractor of a
practitioner from referring a patient of the practitioner, for a service or for
goods related to health care, to a health facility, medical laboratory or
commercial establishment in which the practitioner has a financial interest.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5404Authorized referrals.The following referrals do
not present a perception of a conflict of interest, are consistent with the
overall purpose of chapter 439B of
NRS and are not prohibited by the provisions of NRS 439B.425:

1. Any referral within one or more locations
of a business entity if:

(a) The goods or services provided as a result of the
referral are routinely provided to all patients of the referring practitioner
based on their needs;

(b) The referring practitioner has the right to see
regular patients for personal medical care, consultations, diagnoses and
treatment at the same site and general location where the goods or services
will be provided as a result of the referral;

(c) The goods and services provided as a result of
the referral are billed as part of the bill provided by the referring
practitioner or the business entity;

(d) The goods or services provided as a result of
the referral are not provided at a facility operating under a different name;
and

(e) The referral is not a referral by a licensed
physician to a medical laboratory:

(1) In which the physician has a financial
interest; and

(2) That is not operated solely in connection
with the diagnosis or treatment of the physician’s patients.

2. Any referral within one or more locations
of a business entity if:

(a) The goods or services provided as a result of
the referral are not provided at a facility operating under a different name;
and

(b) The referral does not result in any revenue for
the referring practitioner, except in the form of additional net profit of a
business:

(1) That is based upon a formula reflective of
the referring practitioner’s percentage of ownership; and

(2) That is incidentally increased by the
referral.

3. A referral made to a renal dialysis
center for the treatment of end-stage renal disease.

4. A referral of a patient who is covered
under a capitated insurance program, if the referral does not result in any
additional revenue for either the referring practitioner or the business entity
to which the patient is referred.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94;
A 7-7-94)

NAC 439B.5406Authorized referrals to facilities in which practitioner has
financial interest.

1. The provisions of NRS 439B.425 do not prohibit a
practitioner from referring a patient, for a service or for goods related to
health care, to a health facility, medical laboratory or commercial
establishment in which the practitioner has a financial interest if the
referral is made on or before June 30, 1994, and:

(a) The financial interest existed on or before June 30, 1993;

(b) The practitioner files with the director, on or
before December 31, 1993, a form provided by the department for the purpose of
declaring a financial interest and requesting the authority to make the
referral until June 30, 1994;

(c) The practitioner cures any defect in the form
filed pursuant to paragraph (b) within 15 days from the date of postage of the
notice of that defect provided by the director pursuant to subsection 4; and

(d) The practitioner provides to each referred
patient a written notice of his financial interest in any goods or services to
be provided as a result of the referral.

2. The provisions of NRS 439B.425 do not prohibit a
practitioner who, pursuant to subsection 1, has the authority to make a
referral until June 30, 1994, from referring a patient, for a service or for
goods related to health care, to a health facility, medical laboratory or
commercial establishment in which the practitioner has a financial interest if
the referral is made on or before December 31, 1994, and:

(a) The practitioner files with the director, on or
before May 31, 1994, a form provided by the department for the purpose of
requesting the authority to make the referral until December 31, 1994;

(b) The practitioner cures any defect in the form
filed pursuant to paragraph (a) within 15 days from the date of postage of the
notice of that defect provided by the director pursuant to subsection 4;

(c) The practitioner submits an affidavit
testifying that there has been a good faith effort to divest the financial
interest or otherwise come into compliance with NRS 439B.425 and setting forth
the practitioner’s plan to divest the financial interest; and

(d) The practitioner provides to each referred
patient a written notice of his financial interest in any goods or services to
be provided as a result of the referral.

3. For any request for the authority to make
a referral pursuant to subsection 2, the director will notify the practitioner
in writing of his decision on or before June 30, 1994.

4. If there is any defect in a form
submitted pursuant to paragraph (b) of subsection 1 or paragraph (a) of
subsection 2, the director will provide notice of the defect to the
practitioner by mail.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

NAC 439B.5408Investigation of possible prohibited referral by practitioner;
determination by director after investigation.

1. If the department becomes aware of a
possible violation of subsection 1 of NRS 439B.425, it may investigate
the violation or forward the information to the applicable licensing board of
the practitioner.

2. If, after an investigation is conducted
pursuant to subsection 1, the director determines that there is:

(a) Sufficient reason to believe a violation of
subsection 1 of NRS 439B.425
has occurred, he will schedule and hold a hearing pursuant to chapter 233B of NRS. If, at the
hearing, it is found that a violation of subsection 1 of NRS 439B.425 has occurred, the
director may impose a fine pursuant to subsection 2 of NRS 439B.450.

(b) Not sufficient reason to believe that a
violation of subsection 1 of NRS
439B.425 has occurred, he will notify the practitioner of his determination
in writing.

(Added to NAC by Dep’t of Human Resources, eff. 3-9-94)

EDUCATIONAL PROGRAM TO PROMOTE WELLNESS, PHYSICAL FITNESS AND PREVENTION OF DISEASE AND ACCIDENTS

NAC 439B.550Development and implementation of program.An
educational program developed pursuant to NRS 439B.280 must be designed to
address problems or objectives related to health that are identified in National
Health Promotion and Disease Prevention Objectives for the Year 2000,
published by the United States Public Health Service. The major hospitals must
determine the form and content of each program, but a program must be approved
by the director before it is implemented.

(Added to NAC by Dep’t of Human Resources, eff. 12-31-91)

NAC 439B.555Description of program: Submission to director; contents.At least
30 days before initiating an educational program pursuant to NRS 439B.280, the major hospitals
shall submit to the director a description of the program, including:

1. The name of the person responsible for
liaison with the director regarding the program;

2. Each problem or objective identified in National
Health Promotion and Disease Prevention Objectives for the Year 2000 that
the program is intended to address;

3. A syllabus or outline of the content of
the program, indicating the major points to be conveyed, other significant
points to be conveyed and the organization or sequence of presentation; and

4. Biographical sketches of the instructors,
facilitators or leaders, indicating their professional competence to instruct
in the relevant subject areas. If the instructors, facilitators or leaders for
the program have not been selected at the time the plan is submitted to the director,
a brief statement of required professional qualifications must be included.

(Added to NAC by Dep’t of Human Resources, eff. 12-31-91)

NAC 439B.560Description of program: Accompanying statement.The
description of an educational program submitted pursuant to NAC 439B.555 must be accompanied by a statement from
the major hospitals that:

1. If participation in or benefit from any
part of the program is contingent upon the payment of a fee or the purchase of
goods or services from one of the major hospitals or a facility affiliated with
a major hospital, no prospective participant will be denied such participation
or benefit on the basis of failure or inability to pay the required fee or
charges.

2. Prospective participants will not be
discriminated against on the basis of race, color, religion, national origin,
sex or sexual orientation except to the extent such discrimination is clearly
directed against persons or classes of persons who would not benefit from the
program.

(Added to NAC by Dep’t of Human Resources, eff. 12-31-91)

NAC 439B.565Notification by director of decision regarding program;
opportunity to make corrections.The director will notify
the person designated as liaison for a proposed educational program of his
decision within 15 days after his receipt of the description of the program. If
the program is disapproved, the director’s notice will specify the required
corrections and the hospitals will have an additional 15 days after the date of
receipt of the notice of disapproval to make those corrections.

(Added to NAC by Dep’t of Human Resources, eff. 12-31-91)

PETITION FOR DECLARATORY ORDER OR ADVISORY OPINION

NAC 439B.600Applicability.Any person or entity that is or may be
subject to a provision of chapter 439B
of NRS, or any regulation or prior decision of the Director adopted pursuant
thereto, may file with the Director a petition, in letter form, for a
declaratory order or advisory opinion as to the applicability and
interpretation of the provision to the person or entity. The petition must be
filed by mailing the petition to the State of Nevada, Director of the
Department of Health and Human Services, Kinkead Building, Room 600, 505 East King Street, Carson City, Nevada 89710, by certified mail with a return receipt
requested.

(Added to NAC by Dep’t of Human Resources, eff. 7-7-94)

NAC 439B.610Contents of petition.A petition for a declaratory
order or advisory opinion filed pursuant to NAC
439B.600 must include:

1. A statement of each issue upon which the
petitioner is seeking a declaratory order or advisory opinion, including
references to the provision of any statute, regulation or prior decision of the
director which the petitioner believes is at issue.

2. A statement of the factual circumstances
that relate to the issues upon which the petitioner is seeking a declaratory
order or advisory opinion, including, but not limited to:

(a) The type of business involved and the goods and
services delivered, if any;

(b) A list of persons and entities with an existing
or proposed financial interest in the business involved, the type of financial
interest held by these persons or entities, including any interest in an
executed or proposed contract, agreement or arrangement and an explanation of
the role of these persons or entities in the delivery of goods and services delivered;
and

(c) A flow chart of the business involved that
shows the existing and proposed ownership, structure of business operations,
locations of major equipment or laboratories, names of each entity or facility
and patterns of referral among each practitioner, entity or facility involved.

3. A statement of the factual circumstances
demonstrating how the existing and proposed structure of the business involved:

(b) Reduces the cost of medical care through an
improved competitive market; and

(c) Provides checks for and balances to self-interested
referrals and excessive utilization of goods and services.

(Added to NAC by Dep’t of Human Resources, eff. 7-7-94)

NAC 439B.620Powers of director: Designation of person to issue declaratory
order or advisory opinion; consolidation of petitions for advisory opinions.

1. The director may designate a person
within the department to issue a declaratory order or advisory opinion pursuant
to NAC 439B.600 to 439B.640,
inclusive.

2. The director or his designee may issue a
declaratory order that consolidates two or more petitions for an advisory
opinion.

(Added to NAC by Dep’t of Human Resources, eff. 7-7-94)

NAC 439B.630Issuance of declaratory order or advisory opinion: Time for
issuance; tolling of time for issuance; consolidated petitions.

1. Except as otherwise provided in
subsections 2 and 3, the director or his designee will issue a declaratory
order or advisory opinion pursuant to NAC 439B.600
to 439B.640, inclusive, within 60 days after the
date on which a petition for a declaratory order or petition for an advisory
opinion is filed.

2. The running of the time period for the
issuance of a declaratory order or advisory opinion provided in subsection 1
shall be deemed to be tolled under the following circumstances:

(a) If the director or his designee requests that
the petitioner submit additional information to the director or his designee
after the date the petition for a declaratory order or advisory opinion was
filed. The running of the time period for the issuance of a declaratory order
or advisory opinion provided in subsection 1 shall be deemed to be tolled from
the date the director or his designee mails the request for additional
information to the petitioner until 30 days after the date on which the
director or his designee receives the additional information from the
petitioner.

(b) If the petitioner, without receiving a request
for additional information from the director or his designee, submits
additional information to the director or his designee after the date the
petition for a declaratory order or advisory opinion was filed. The running of
the time period for the issuance of a declaratory order or advisory opinion
provided in subsection 1 shall be deemed to be tolled from the date the
additional information is received until 30 days after the date on which the
director or his designee receives the additional information from the
petitioner.

3. When the director or his designee decides
to consolidate two or more petitions for an advisory opinion and issue a
declaratory order, the director or his designee will set a date for the
issuance of the declaratory order which will allow for proper consideration of
the issues and which may reasonably exceed 60 days after the dates on which
each petition for an advisory opinion to be consolidated was filed. The
director or his designee will notify each petitioner by mail of the date set
for the issuance of the declaratory order.

(Added to NAC by Dep’t of Human Resources, eff. 7-7-94)

NAC 439B.640Copy of declaratory order or advisory opinion to be mailed to
petitioner and made available to public.Upon the issuance of a
declaratory order or advisory opinion pursuant to NAC
439B.600 to 439B.640, inclusive, the director
or his designee will mail a copy of the declaratory order or advisory opinion
to the petitioner and will make a copy of the declaratory order or advisory
opinion available to the public for inspection.